The Subrogation Strategist

In Emerald Point, LLC, et al. v. Hawkins, et al., 808 S.E.2d 384 (Va. 2017), the Supreme Court of Virginia considered whether a trial judge’s adverse inference instruction regarding the spoliation of evidence was warranted when there was no indication that the defendant destroyed the evidence at issue with the deliberate intent to deprive the plaintiff of a fair opportunity to use it in pending or reasonably foreseeable litigation between the parties. Prior to this case, Virginia allowed adverse inference instructions when there was intentional spoliation of evidence. The Emerald Point court held that a spoliation instruction is only warranted when there is proof of the intentional destruction of evidence based on a desire to deprive the opposing party of the opportunity to use it in litigation. The Emerald Point case reminds us that we cannot assume that any party will receive an adverse inference instruction at trial simply because the opposing party destroyed evidence. As in many other jurisdictions, to receive an adverse inference instruction in Virginia, the party requesting the instruction must show that the destruction of the missing evidence was intentional.

Emerald Point addressed alleged personal injuries suffered by the tenants of an apartment building. Lindsey Hawkins, Paul Harmon, Thomas Zamaria and Edward Guire (“the tenants”) all lived in the apartment building. The building was owned by Emerald Point, LLC and managed by The Breeden Company, Inc. (“Breeden”). On January 4, 2013, following repeated attempts to correct carbon monoxide levels in the tenants’ apartments, Breeden retained a heating and air conditioning contractor to replace the building’s furnace. The contractor found that the flue to the furnace in one of the apartments was not properly connected, resulting in carbon monoxide being vented into the attic.

In November of 2014, the tenants sued Breeden and Emerald Point, alleging faulty maintenance of the furnace and its associated vent and flue system, and claiming damages resulting from their exposure to carbon monoxide. Prior to trial, the plaintiffs filed a motion requesting an adverse inference instruction at trial based on the defendants’ disposal of the furnace at issue. At trial, the judge instructed the jury that, if a party in exclusive possession of evidence disposes of evidence that it knew or should have known would be material in a potential civil action, the jury could, but was not required to, infer that if the evidence had been available, it would have been detrimental to the party disposing of the evidence. After the trial concluded and the jury found in favor of the plaintiffs, the landlord appealed, raising several issues, including challenging the spoliation instruction. The Supreme Court reversed the circuit court’s judgment and remanded the matter for a new trial.

In its decision, the Emerald Point court looked to the federal courts for guidance on the spoliation issue. Following their lead, the court reasoned that a severe action such as an adverse inference instruction was not just or proportionate when the destruction of the evidence at issue was not done with bad faith. Since the subject furnace was only discarded after a year of sitting in a maintenance bay, there was no evidence of bad faith.

The Emerald Point case is important because it shows a growing trend of courts: to require evidence of bad faith by an opposing party who destroys evidence before giving an adverse inference instruction. This is important for a practitioner to understand not only when preparing a case for trial, but also in the early stages of the investigation. Since it is unlikely that the destruction of evidence will ever result in such an inference, ensuring that evidence is safely preserved and experts have access to it early on is critical.